Victoria’s energy landscape is set for a significant transformation with the announcement that the State Electricity Commission (SEC) will partner with Italian clean technology firm Energy Dome to develop Australia’s first commercial long-duration compressed carbon dioxide (CO2) battery. The 20 MW / 200 MWh system, capable of continuous operation for 10 hours, is slated for deployment near Morwell in the Latrobe Valley.
The project, announced on July 13, 2026, marks a pivotal step in Victoria’s energy transition, aiming to provide crucial grid stability as the state moves away from coal-fired generation. It will be a cornerstone of a new 143-hectare energy innovation precinct adjacent to the decommissioned Hazelwood power station.
SEC Chief Executive Officer Chris Miller emphasised the growing recognition of long-duration energy storage (LDES) as essential for evolving power systems. “Long-duration energy storage will play a foundational, system-level role in Victoria’s future energy system, firming variable renewable generation from wind and solar to deliver the around-the-clock reliability of supply that’s needed to power our homes, businesses and communities,” Miller stated.
This 10-hour duration battery significantly surpasses the typical two to four hours offered by most existing battery energy storage systems (BESS) in Victoria, providing more than double the duration. It represents a critical advancement in addressing the challenges of firming intermittent renewable energy sources like solar and wind over extended periods, including during multi-hour or multi-day generation droughts.
Technology: How a CO2 Battery Works
Energy Dome’s proprietary CO2 Battery technology operates on a thermodynamic cycle. It stores energy by compressing gaseous CO2 into liquid form. When power is needed, the liquid CO2 is heated and expanded back into a gas, driving a turbine to generate electricity. This closed-loop system reuses the same CO2 repeatedly, making it a sustainable solution for large-scale, long-duration energy storage. The technology leverages readily available components and offers a competitive alternative to traditional battery chemistries for extended discharge durations.
“Long-duration energy storage will play a foundational, system-level role in Victoria’s future energy system, firming variable renewable generation from wind and solar to deliver the around-the-clock reliability of supply that’s needed to power our homes, businesses and communities.” – Chris Miller, CEO, Victorian State Electricity Commission
Strategic Location and Broader Impact
The choice of Morwell in the Latrobe Valley is strategic, positioning advanced energy technology in a region historically reliant on coal. This aligns with broader efforts to transition coal communities into hubs for renewable energy and associated industries. The project is expected to create new jobs during construction and ongoing operational roles, contributing to regional economic diversification.
The development also highlights Australia’s increasing focus on diverse battery technologies to meet ambitious emissions reduction targets. While lithium-ion batteries dominate shorter-duration applications, the need for LDES solutions, such as pumped hydro and compressed air, is growing to ensure grid stability and reliability as coal plants retire. The GenCost 2025-26 Final Report, released by CSIRO and AEMO, recently reaffirmed that renewables supported by storage remain the lowest-cost pathway for Australia’s net-zero electricity system, with battery storage costs continuing to fall.
This initiative complements other significant battery deployments across the National Electricity Market (NEM). For instance, New South Wales transmission operator Transgrid recently updated its plans to incorporate an expanded role for grid-forming batteries, targeting 900 MW by the early 2030s to bolster system strength in the state.
The Drive for Long-Duration Storage
The proliferation of rooftop solar in Australia, now installed on over 3.7 million homes, has created an abundance of daytime energy. However, managing this influx and ensuring supply during evening peaks or periods of low renewable generation requires substantial and flexible storage.
Traditional short-duration batteries are excellent for smoothing momentary fluctuations and providing ancillary services, but LDES solutions are critical for shifting large quantities of energy over many hours or even days. The Victorian CO2 battery is a direct response to this need, providing a tangible example of how innovative technologies are being deployed to firm the grid. This push for advanced storage is also reflected in the federal government’s National Renewable Energy Priority List, which recently added 11 new generation and battery storage projects, including several with co-located BESS capacity.
Homeowners considering their own energy storage options should note that while grid-scale batteries address system-wide needs, residential batteries offer direct bill savings and energy independence. You can explore the Best Home Solar Batteries in Australia 2026: Models, Prices & Post-May Rebates to understand current offerings and incentives. Understanding the broader energy market, including how large-scale projects contribute to grid stability, can help in making informed decisions about personal energy investments. For those looking at solar installation, a comprehensive guide to costs and considerations is available at Solar System Installation Costs in Australia 2026: A Complete Guide.
This project represents a significant technological diversification in Australia’s energy storage portfolio, moving beyond conventional lithium-ion solutions to explore novel methods for ensuring a reliable and decarbonised electricity supply for the future.